Doha: Gold prices fell on Monday to their lowest level in a week before recovering slightly as a cease-fire truce between the United States and Iran neared its end, pushing the dollar and oil prices higher. Spot gold was down 0.5 percent at $4,802.75 an ounce after hitting its lowest level since April 13 earlier in the session. US gold futures for June delivery declined 1.2 percent to $4,823.10.

According to Qatar News Agency, the dollar rose to a one-week high before paring gains, as renewed tensions between the United States and Iran created uncertainty in markets over the prospects for reaching a peace agreement. Yields on 10-year US Treasury bonds climbed, increasing the opportunity cost of holding non-yielding gold.

Oil prices jumped about 5 percent on fears that the cease-fire could collapse, while flows through the Strait of Hormuz remained largely disrupted. Although gold is considered a hedge against inflation, demand for non-yielding assets tends to weaken when global interest rates are high. Borrowing costs are expected to remain elevated for longer as inflation rises amid the war in the Middle East.

Among other precious metals, spot silver fell 1.2 percent to $79.83 an ounce, platinum dropped 1.5 percent to $2,071.70, and palladium slipped 0.2 percent to $1,555.79 after touching its lowest level in a week earlier in the session.